EU: Mandatory reporting law passed by European Parliament
Date: 16 Apr 2014
Major businesses in Europe will be required to produce social and environmental reports as part of their standard annual report following the passing of a law in the European Parliament.
The law was the subject of a lot of last-minute wrangling, with some countries expressing reservations that it would be an additional layer of bureaucracy for businesses. As a result, a considerable degree of flexibility was built into the final form of the legislation.
Companies will be able to choose the relevant indicators against which they should report and a lot of large companies - particularly private companies - will be exempt from the law altogether. Reports will be audited, but don't have a requirement to be verified.
Nevertheless, as a result of the law, some 6,000 companies will be required to report on areas such as human rights and the environment, diversity, corruption and social issues.
Businesses have been split over the legislation. Companies such as Unilever and IKEA have gone on record in support, but other key European business lobby groups have been in opposition.
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